The human nuclear receptor pregnane X receptor (PXR) responds to a wide variety of potentially harmful chemicals and coordinates the expression of genes central to xenobiotic and endobiotic metabolism. Structural studies reveal that the PXR ligand binding domain (LBD) uses a novel sequence insert to form a homodimer unique to the nuclear receptor superfamily. Terminal beta-strands from each monomeric LBD interact in an ideal antiparallel fashion to bury potentially exposed surface beta-strands, generating a 10-stranded intermolecular beta-sheet. Conserved tryptophan and tyrosine residues lock across the dimer interface and provide the first tryptophan-zipper (Trp-Zip) interaction observed in a native protein. We show using analytical ultracentrifugation that the PXR LBD forms a homodimer in solution. We further find that removal of the interlocking aromatic residues eliminates dimer formation but does not affect PXR's ability to interact with DNA, RXRalpha, or ligands. Disruption of the homodimer significantly reduces receptor activity in transient transfection experiments, however, and effectively eliminates the receptor's recruitment of the transcriptional coactivator SRC-1 both in vitro and in vivo. Taken together, these results suggest that the unique Trp-Zip-mediated PXR homodimer plays a role in the function of this nuclear xenobiotic receptor.